Help to Buy makes ‘flying start’ with 4,000 reservations

Around 4,000 reservations have been made for new homes using the government’s Help to Buy scheme in just two months since the launch.

The Home Builders Federation said the scheme had made a ‘flying start’ and that the housebuilding industry would be able to significantly increase its output thanks to the government programme.

The equity loan aspect of the Help to Buy scheme launched on April 1 and is expected to deliver around 74,000 sales in the next three years.

Stewart Baseley, executive chairman at the Home Builders Federation, said: “It has been an unqualified success so far and 4,000 reservations in just two months shows both the consumer demand for the scheme and developers’ commitment to it.

“The large deposits required in recent years to secure a mortgage have prevented many from buying – and as a result, builders from building.

“The equity loan scheme helps consumers overcome that deposit barrier and as a result the scheme will undoubtedly lead to an increase in house building – already we are seeing companies revise their projected build levels as a direct result of the scheme. This in turn will create jobs and deliver an economic boost.”

The mortgage guarantee part of the scheme will launch in January and is predicted to generate 190,000 sales each year, this would account for a fifth of all mortgage transactions in the UK.

Research from LSL found that the number of purchases entirely self-funded by first-time buyers was 51% in April as almost half of all first-time buyers (49%) received help to buy from an outside source (such as their family, or a government scheme).

Well over a third of first-time buyers (36%) received direct financial help to buy from their family, a further one in 12 (8%) were using funds from an inheritance, while just one in a 100 (1%) was aided by a government scheme.

Figures for the NewBuy scheme were announced earlier this week, fewer than 800 people bought homes under the scheme in the first three months of the year.

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